HomeMy WebLinkAboutResolution No. 18-7815-Approving a Master Equip Lease Purchase Agmt w-Community First National Bank Aquisition of Two AmbulancesA RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DOWNEY
APPROVING A MASTER EQUIPMENT LEASE PURCHASE AGREEMENT
AND SCHEDULE OF EQUIPMENT NO. 1 WITH COMMUNITY FIRST
NATIONAL BANK IN CONNECTION WITH THE ACQUISITION OF TWO
AMBULANCES
WHEREAS, the City Councili as the governing body of the City of Downeyi has
determined that a true and very real need exists for the acquisition of two Ford E450 Road
Rescue Type 3 Ambulances ("Equipment") described in the Master Equipment Lease
Purchase Agreement and Schedule of Equipment No. 1 presented to the City Council this
meeting and that it is appropriate to finance the acquisition of the Equipment n t is manner;
and
WHEREAS, the City of Downey has taken th rap Ii
arrange for the acquisition and financing of such Equipment.
NOW, THEREFORE THE CITY COUNCIL OF THE CITY OF DOWNEY DOES
HEREBY RESOLVE AS FOLLOWS:
SECTION 4. That the Master Equipment Lease Purchase Agreement and Schedule
of Equipment No. 1 ("Agreement") attached hereto as Attachment "A" is hereby
approved as the best means for the City of Downey, as Lessee in the Agreement,
to finance the acquisition of such Equipment, and the City Council designates and confirms
that either individual listed below is authorized to execute and deliver on behalf of the City the
Master Equipment Lease Purchase Agreement and any related documents, including the
Schedule of Equipment No. 1 ("Schedule"), deemed by such person necessary to the
consummation of the transactions contemplated by the Agreement:
SEAN ASHTON, MAYOR OR GILBERT A. LIVASj CITY MANAGER
CITY OF DOWNEY CITY OF DOWNEY
SECTION 2. The above-named representatives of the City held their position of Mayor
and City Manager at the time of such authorization, and at the present time hold their respective
offices as set is above.
SECTION 3. The meeting of the Downey City Council at which the Agreement and the
Schedule were approved and authorized to be executed was duly called, regularly convened
and attended throughout by the requisite majority of the members thereof and that the action
altered or rescinded.
SECTION 4. No event or condition that constitutesi or with the giving of notice or e
lapse of time or both would constitute, an Event of Default (as such term is defined in the
Agreement), exists as of the date of this Resolution adoption.
SECTION 5 All insurance required in accordance with the Agreement is currently
maintained by the City of Downey,
RESOLUTION NO.
PAGE 2
SECTION 6. The City of Downey has, in accordance with the requirements of law, fully
budgeted and appropriated sufficient funds for the current budget year to make the rental
payments scheduled to come due during the Original Term (as defined in the Agreement) and to
meet its other obligations for the Original Term and such funds have not been expended for
other purposes.
SECTION 7. The fiscal year of the City of Downey is July 1 to June 30.
SECTION 8. The City Clerk shall certify to the adoption of this Resolution;
APPROVED AND ADOPTED this 26th day of J `; e, 2018.
C45��
SEAN ASHTON, Mayor
G
ARI'&C�IADU�ART, CM
City Clerk
HEREBY CERTIFY that the foregoing Resolution was adopted by the City Council of
the City of Downey at a regular meeting held on the 26th day of June, 2018 by the following
vote, to wit:
AYES:
Council Members:
Pacheco, Saab, Vasquez, Rodriguez, Mayor Ashton
NOES:
Council Member:
None.
ABSENT:
Council Member:
None.
ABSTAIN:
Council Member:
None.
hl '<2 Al..a' a- "_a
'WkAULICIA DUARTE, MC
City Clerk
ATTACHMENT A
MASTER
EQUIPMENT LEASE PURCHASE AGREEMENT
LESSEE, City of Downey
■
WHEREAS the roietlnnab[p between the parties shall be a continuing one and items of equipment may be added to or deleted from the Equipment from
time to time by exactition of additional Schedules by the pailles heretr and as otherwise provided herein.
WHEREAS, Lessee Is authorized under the constitution and laws of the State to enter into this Agreement for the purposes setforth herein.
NOW, THEREFORE, for and In consideration of the premises hereinafter contained, the parties hereby agree as rollows:
it L E 1_ RgpRESENTAtIONS. WARRAN71ES AND COVENANTS OF LESSEE
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Is a rnunlcipat corporate and chartercity, duly organized and extsurig under rise t;onssntown nose w* - ,,,ti
will do or cause to be done all things necessary to preserve and keep in full force and affect Its existence as a body corporate and pollto.
Is a political subd#vieldn of the Stats within the meaning of Section t o3(a) of the Codo<
has full power and authority tinder the Constitution and is of tree Stale to anter into this Agreement and
the transactions contemplated
and to perform all of its obligations heraundet
has duly authorised the executions and deli.very of thea Agreement by proper action by Its governing body at a;moatng duly called,
y convened and attended throughout by the requlsttcs majority of the members thereof, or by other appropriate official approval. and 04
arints have been met and procedures have occutrad its order to ensure the enforcriablifty of this Agreement,
has compiled or will comply with such public bidding romer is as may be applicable to this Agreement and the acquisition by Lesson
Iqulpment„
the Lasso Term, the Equipment will be used by Lessee only for the purposaof perforating one or more essential governmental or
lary funelkons of Lessee consistent wins the permissible scope of L aa's authority and will 'not be used In a trade or business of any
or amity otherthan Lessee.
the Lease Term, Lmee will annually provide Lessor with current financial ial statements, budgets, proof of appropriation for the ensuing
ear and such other frienokal Information rotating to the ahithy of Losses to continue this Agreement as may he masonabty requested by
pipmant will have a useful life In the hands of Lessee that Is substantially In excess of the Original Term and all Renewal I Terms.
fuipment is, and during the Lease Term will remain personal property, and when subjected to use by the Losses, will not be or become
p'iprnent Is essential to the function of the Lessee and the services provided to Its cittzerus, and will be used throughout the period that this
vont is in force ferthe purpose of performing one or mote governmental or propflistalrYfunC110as>conslstant with the permissible scope of its
ty
the form of this Agreement Lessers will not dispose of or self any part ofthe Equipment
s has not terminated a prase, rental agreement histaItmorit purchase contract, or any other print of such agreement in the past five (5)
ra a result of insufficient funds being approprleted for payments due under such an agreement,gre;,
steam constitutes I" legal, valid and binding obligation of Lessee ordercisable in accordance with Its terms, except to the extent limited
llcable baMouuptc% Insolvency, ruorga .riot' or other laws affecting creditors' rights generally.
int or condition that constitutes, or With the giving 01 netice or the lapse of time or both would constitute, an Event of Default exists at the
f this Agreement,
k has, In accordance vW(h the requirements of law, fully budgeted and apprepriated sufficient funds for the current fiscal year to make khe'
Payments schedWad toy.,come due during the currenttiscal year and to meet its other obiigations under this Agreement for the current
eamr, anrt rumh furds have not been extionded fret° other purposes, 1 _.:1—
order, law or regulation applicubta to Lessee or result In
security tuts t: or other encumbrance on any assets of
or credit agreement or other Instrument to which Lessee
9 Agreement or any other document,
anter materially adversely afloat the
he execution and delivery by Lessee
shed.
retry to which 4essee Is or Ia to be a
a t t s l t o oo ut o:
tgrsentfrnt"` mdanp this master Equip t Leap i'urchaae Agreafnent, includ9tkg the Schedules and any other dull, exhibit or esctow agreement
tette a park heraof;tsy the entries tterel t„ wise#Isar ourrenUy In e tlskenoo or tserspfter executed, as the sante be supplemented or amended from time
r erne ks a000rdanoo with ttaaq terms hereof,
sesta° means rho ltmtemal t tvonue mode of iiiS , ss ertdod, orad the Linitod Stakes Treasury Regulations in efirespect
Lha€sunder.
orasmsricetiserst Lisle" manias, with respoet to. any Sohedute, rho deka when Lha tarns of this Agreement with eslrt to that Schedule and Lessee's
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bligation to pay rent under that Srheduts commence, Which date shall be the earlier of (1) the dats on which the Equltment listed in that Schadute is
ocepted by Losses in the mariner described In an Acceptance Cwtiicate substantlaity In the forma of Exhibit D hereto, or (11) the date on which sufflotent
woeys to purchase the Equipment listed on that Schedule ere deposited by Lessor for that purpose with ars escrow agent
Equipment' means the property debred In the Schedules and sti raplasernorits, substitutions, repairs, restorations, rnodlficagons, attachmo;ts
(.
caeosions, addlilons aria ImptieVemants thereof or theretco. Whenever raaference in made In this Agreement to lEquipmant listed In a Schedule, that
Mall be deemed to tnctt a alt replacements, repairs, restorations, rnodiffcallons and improvements of or to that EquiprnanL
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afwance
Event of Defeutt" means, v4#i realserA to any Lease, an Event of Default described in Section 10.01.
Escrow Agreement' means, Wtts tesped to a given ched([la, an Oscrow agreameAt In form and substance satisfactory to Lessor, between Lessee,
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.rassw and an escrow agent relating to the acquisfflon freta. created thereunder,
Lease means, at any time, (l) If none of Lessees interest in, to and under any Schedule has been assigned pursuant to Section 9,01, or If mil of Lessor's
this Agreement, or ) If
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itarest In, to and under this Agreement and all Schadules have been assigned to the some a salgnae without any reasighmant,
r`s Interest in, to and under any Schedule or Schedules has been assigned or reassigned pursuant to Section 5.01„ all Schedules that have ft some
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.essor and this Agreement as it relates to those Schedules and the Equipment listed therein, which shall constitute a separate single lease relating to that;
s
equipmenL
Lease Term means, with rasped to any Lease, tate OrrgBnal Term and all Renewal Terms of that Leese.
Lessee' means the entity which is described in the first paragraph of this Agreement, Its successors and asslgna.
Lesser, means, with respect to each Schedule mid the Lease of which that Schedule is a part„ 3 If Lersedes Internet In, to and under that Schedule has
got been assigned pursuant to Section 9 M, the entity doscribad'as such In the fist paragraph of this. Agreement or Its successor, or (11) It Lassoes Inter
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n, to and under that Schedule has been assigned pursuant to Sactfon 9.01, the assignee thereof or its succosaw
'Not Pmcoeda' means the amount remaining from than grass proceeds of any insurance claim or corideotnatlgn award after deducting all expenses
Iftfudirg atlarneye (Anal incurred lir the collection of such claim or award.
"Original Tonna'" means, with respect to any Lease, the period from the Isnot Commencement Bale for any Schedule wieder that Lease unig the and of the
Iscal year of Lessee In aflact at that Commencement Dale.
,purdieso Price, means, with respect to the Equipment listed on any Schedule, the amount set todh In that Schedule as the Pureness P600 for that
Egislpma;La
'Renewal TemW memis, with rasped to any Leaser the utdomutic renewal terms of that Less% as provided for in Article Iii of this Agreement, each
naving a durstion of one year and a term co -extensive with the Lessee`s flacal year except the last of such automatic renewal terms which shall and on tike
1
due date ofthe last Rental Payment set forth in the Schadula.
'Rental Paymente means the basic rental payinents payable by Lessee pursuant to section a,
i
"StarW means [tae state In which Losses is located.
"Vendor" means the manufacturer of the Equipmnt as well as the agents or dealers of the manufacturer from whom Lassar purdmaed or is purchasing
the Equipment.
i
ARTICLE 111. LEASE TERM
5 Lease of Eoutiamant Lessor hereby demises, teases and tots to Leasee, Lessor, refers, ie orad hI trots Lessor, the Equipment
listed In each Schedule In accordance with this Agreement and that Schedule (or the Lease Term for the Lone of which that Schedule Is a part, The
Lease Term for each Lass may be continued at the and of the Orlgltial °Corr; or any Renewal Term for an additlonai Renewall Terre,, provided, however,
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that at the and of the Original Term and at the end of each Renewal Tarin, s be doomed to have continued that Lease for the next Renewal
Term unless Lessee shall have ;terminated that Lwas pursuant to Section d«s or Section 6,04, The terms and conditions during any Renewal Term
shall be [he same as the terms and conditions during the Original Term, except that the RentalPayments shaft be as provlded In the Schedules. Lessor'
during the Lease Term with use and enjoyment of rho Equipment, and Losses shall during the Lease Te rm
hereby covenants to provide Lowe riviet
peaceably and quietly have hold and enjoy the Equipment without suit, trouble or hindran fiam Lessees ex t as ex sty met recite in this
Agreement„
on 02 oantinutatlo; rsf Lease ,.Term, Lessee currently tntonds„ subject to Section 4.04, to erintl;ua the losses Term for each Lease through the
Original Term and ail Ina Renewal Te and to pay the Rental Paymentshereunder. Lessee ably bal'aa s that tagally a 'It.i% funds to m'n
of
amount sufficient to mWo all Rental payments during the Lease Terni for each Lowe can he Obtained. Ther on financial officer sof Lessen shall do
funds from which the Rental Payments may be made, htclttding me" provision for the
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all things lawfully withirt his or her power to obtain and maintain
Rental Payments to His extent necessary In each proposed annual budget submittedforapproval in accordance wain applicable ppicedures of Lessee and to
exhaust all avelfable rout and appeals in,the event such portion of the budget Is not approved. Notwithstanding The foregoing, the decision whether or
not to budget or appropriate Bads or to extend a Lease for arty Renewal Tam is actely within the discredaur of the then tuffent govarntog beady of Lessee.
cdtio t Lipo; axtilration oar carr inaMion of any Schedule under any provision of this Agre t at a
uta Equlprnenl drascrtbsd in Ss hadule u;deciles provisions of ibis Agreement. Lessee shall
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dee when Cassano dcaes ntrt axeroisa its optic; io pstrciaa
deliver, at ee^s a nee the Equlpinent desotthed to stat Sclsedaria io Lear in the saaraa o as existed at the Commencement tae oh+
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wear d tear a erode pa gad tar ottrsrauisa p rad Ira a man;er sultmlrte by slsiyairtaat try truck or watt common carrier -at a location spa fled by
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Lesaw.
sc n 5.04, it ns L r leap a d l a, As a prerequisite to lite performance by Lessor of arty of Its obligations pursuant to
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ties "Kao too sad .�Utpery of a;y Schadaala, Lessee elralt dsltunr to Lx soon rho Icallor ttq:
(a)IbJ A Lsssaeelutton execrated by the CILrtt or Sacs lary or athmt` comparable oftor of Lowee, In substantially the forth attached to as
Exhiblt ,tated totheSams of L r,Aar Olslnlonoel to see ha uisstantistly ttaa tarns attached hereto as Ext,lbil C respecting such Schadute and OftwAss satlatectOTY to
Lessor,
(o) At documents, including firtsnclrig statements, affidavits, Wices and almdar instruments, in farm satisfactory to Lessor. which Lessor deems
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necessary or appropriate at that rima„
(d) Such other items, if any, as ere set forth ars such Schedule or are reasonably required by Les
'This Agreement Is not a commitment by Lessor to enter Into any Schedule not currently In existence, and nolfiftig in this Agreament shall be construed to
Impose any obligation upon Lessor to enter Into any proposed Schedule, It baling understood that whather Lessor enters into any proposed Schedule shall
be a decision solely withlo Lassoes dlsorettom
Lessee will cooperate with Lessor In Lassoes review of any, proposed Schedule. Without limlling the Foregoing. Leasee will provide Lessor with any
Lessor request In connection with Lessor`s review of any proposed Scho"er. Such dociumentako may Include,
documentation or tnfomrattan may
without limitation, documentation concerning the Equipment and its pouiernplated use and location and documentation or Informatloo concemira iht
financlel status of Lease and other matters related to Lessee:
ARTICLE IV. RENTAL PAYMENTS'
4 enter tar l rat f Lessor and Lessee understand and intend that the obligation of Lessee to
Raihlt€I Pa ante lamrmua&er shall oonstiluto e currant axtaar3me of Lessee end shell not to any way a construed to be a debt of Lessee In
pay
cmniraventian of tray appltcai to oo;alllullonai cr staturary lamltaiions or raqutrarmm�is con amtngt the creation of indebtedness by Lessee, nor shall
anyllsi;g contained herein constitute a pledge rat the general rex raven , funds or monies of Lessee,
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2199wa I a an Lqg= None of t-assee's (niarest in, to and under this Agreement and in the Equipment may be sold.
aSSll;ned, SUbleaSed, pledged or afflorMse ancumberej by I -Mea WIbout the pflor written consent of Lessor.
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part of Lessee contained In this Aqreorrvmt, Lessee agtess, to the extent It Is permitted by taw to do se,:that it win, it assessed by a court of competent
Jurisdiction, pay to Lessor the reasonable fees of those sttomeys and other reasonable expenses so incurred by Lessor.
! Ac oeticrp of fvlon va Any not proceeds from" exercise of any remedy hereunder (after deducting all expenses of Lessor In exardaing d
such remedies Inctuding wAtheut limitation all expenses of taking possession, storing, reconditioning and :selling or leasing Equipment and all brokerage,
ouellonaors or attorneys fees) shall be applied as foil i
(a) If such remedy Is exercised eotaly with respect to a single Schedule, Equipment gated to that Schedule or rights under ftta Agreement related to
that Schedule, then to amounts duo pursuant to that Schadute and other amounts related to that schedule or that Equipment.
(b) It such remedy Is exerci with respect to m than one Schedule, Equipment gated in more than one Schedule or rights atelier tits Agreen# t
related to more than one S4hodule, mets to amounts due pureuent to those Schedules pro rate.
ARTICLE XI. MISCELLANEOUS
e t1 tit t9�: All notices, cortIffoates or other communications hereunder shall be sufficiently given and shall be deemed given when delivered
or mailed by registered mall, postage prepaid, to the parties at their respective places of bustnese.
Saction 4 (fact' A e This Agreement shalt inure to the benefit ire d shall be binding upon
Lessor and Losses, and their respectivo succesaom and assigns. The terms of this Agreement shall not be waived, altered, rrrodlgod, supplemented or
amended in any manner whatecover except by written Instrument signed by the Lessor and ins Lesseo nor shalt any such a mendmant that affects the
rights of Lessor's assignee be effective without such assignWo consent in the event any provision of this Agreement shall be hold Invalid or �•
unenforceable by any court of competent furfarfi Blom such holding shah not invalidate or render unenfo bia any Cather provision hereof. {
Sodn 11.03, AvoilcahkLm This Agreement shag be governed by and canstrued An accordance with the taws of the state Of Californla.
ectlort 11eQd; S ram trs Ilia evert( stay proviatnn of this Agraernant shelf ba hold Invalid or tine ble y any court of competent (udadtction,
such holding shall not Invalidate or tender unenforceable arty other provision hereof
1l.b a. An endman s This Algreementmay be emended, added to, changed or modified by written agreement duly
executed by Lessor and Losses. i
Agreement, Including in writing aaclt Schedule, may be executed M several counterowds,
rlaelt of icis attnil leg an ar"rgtaarri end ail of wnictt shalt cortstltttta hist one and Lha sa Inst ant; a 'tet (1} to the extant that true Schedules and
this prearrtont It relates tato axgnstttu separate Lea a as toed in Agrsament and (l (net t»assoaas interact in, to and sander arty Schedule
aril the Agradrneltt as it relatsa to drat Sensdula, and the �tuiprrtant iteted il'1 that Sonadula rrtay Ica sold or pladgbd ordy b daAlvaring po sibn of rho ;
radglrrak Rdrpart of lila( Schedule mrsrled "" tarrfaart ttla. 1,'* va3s ntarpart l'go. t shalt , dtute cttattet paper far p s ort rho: tlnlforat i`
Commercial Code.I
S on 11.(17. (kuru: The parties hereto agree (Amt the charges In this Agreement and any Lease she# not be a violation of usury or 001ar law. Any such
excess charge shall be appl in such order as to conform this Agreement and such Lease to such applicable taw.
Sactlon 11.1iA. ,lure 7&l Waver, 1 o ttra extant porrnl by taw, lessee pgraas, to walve its dot to a trial by Jury,
Section 14_419pscal to Clooun a tad , Leasee agrees that a ftWinge copy of this Agreement or any Lease with facalmliff signatures may be treated
as an original and will be admissible as evidence ofibis Agreement or such Lease. 1
allots, the captions or h In',ts in Agreement for 0onvenienee only and in noway define, limit or describe the scope or intent {
of any provisions ors. ons of this Agreement.
Lessor and Lessee have caused this Agreement to be executed in their names by their duly authorized representatives listed below. I:
Lease No. DOWCA2018.06AE
LESSEE: LESSOR:
City of D €s Commu First Na ltln n
r.
Seer(Ashton, Maya( Signature f
Blake Rags, VP
Name and Title
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Attested bytY Approved as to form -City Attorney r
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eat Ic's, Cu rt , CIL(. lv tt11 M. Ablch Garcia
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'EXHIBIT A
SCHEDULE OF EQUIPMENT NO. Qi, Dated 71512018
Counterpart No..1,
L5SSOF;VS INTEREST IN, TO AND UNDER THIS SCHEDULE AND THE AGREEMENT AS IT RELATES TO THIS SCHEDULE MAY BE
SOLD OR PLEDGED ONLY BY DELIVERING POSSESSION OF COUNTERPART NO. I OF THIS SCHEDULE, WHICH
COUNTERPART NO. I SHALL CONSTITUTE CHATTEL PAPER FOR PURPOSES OF THE UNIFORM COMMERCIAL CODE,
Re: Master Equipment Lease Purchase Agreement, dated as of 7/512018, between Community First Narlonal Bank, as Lessor, and City of Downey, as
Lessee.
1. Deflned Terms. All terms used herein have the meanings ascribed to them in the above referenced Master Equipment Lease Purchase
Agreement (the 'Master Eqopment Le `°).
2. EquipmeriL The Equipment Incladed under the Schedules of Equipment it comprised of the Items described in the Equipment DesudP90"
attached hereto as Attachment 1, together with oil replacements, substitutions, ropoirs, restorations, modifications, attachments, amselons,
add lions and temente thereof or thereto.
3. Payment Schedule. The Rental Payments and Purchase option p under the Soherfutes of Equipment are set forth In the Payment
Schedule attached as Attachment 2 hereto.
4, RaWasandationa, Warranties and Covenants. Lessee hereby represents. v4MUNS, and tovenants; that its representations, wawandes and
covenants, set forth In the Agreement am true and correct as though made co the date of commencement of Rental PsYmOntS 01 this
Schedule.
6, The Master Equipment Lease. This Schedule Is hereby made as part of the Master Equilpment Lease and Lessor and Lessee hereby ratify
and confirm the Matter Equipment Lease, The torms. and prcrisions of the Moster Equipment Lea." (other than to the extent that they relate
saletv to other schedtfles or Eqolprnant Ilated on other Schodwes) we hereby incorporated by reference and made a Putt haraot
,ra
LESSEE:
City of nay
Attested by City, Clark
Duarte, CMG
LESSOR-
Corrimff omn
lty First Naal
! k
signature
Blake Kaus, VP
Name and TIUe
Approved as to form -City Attomay
-7q�M.
Mich Garcia
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ATTACHMENT I
EQUIPMENT DESCRIPTION
Two (2) New Ford E450 Road Rescue Type 3 Ambulances
With a total acquisition cost of $459,487.30; together with all additions, accessions and replacements thereto. Lessee hereby certifies the
description of the personal property set forth above constitutes an accurate description of the "Equipment!', as defined In the attached
Master Equipment Lease Purchase Agreement and the Equipment Is located on the premise of the Lessee unless otherwise noted by the
Lessee.
no, sic Downey Fire Statiort 1
efive
eT r "L
uL-ment MI be stored aft r d
1727T-VIf �au�i=
Downey, CA 90242
LESSEE,
City
City of ay;
Sean Asht", Wa-yor
Attested by City. Clork, Approved as to form -City me
ILI-
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ATTACHMENT 2
PAYMENT SCHEDULE
RE: Schedule of Equipment No. 01, dated 7/512018, to master Equipment
Lease Purchase
Agreement, dated as of
7/512018, between Community First National Bank, as Lessor, and city of Downey,
as Lessee.
Lease Number DOWCA2018-06AE
Amount Financed: $459,487.30
AMORTIZATION SCHEDULE
Interest
FPurchas
etPaymentPaymentPayment
umber Data Amount Portion
Portion
rice
1 11/1/2018 $100,370.33 $5,818.64
$94,561.69
Not Available
2 11/1/2019 $100,370.33 $14,341-97
$86,028.36
$284,485.40
3 1111/2020 $100,370.33 $10,961.06
$89,409.27
$193,287.96
4 11/1/2021 $100,370.33 $7,447.27
$92,923.06
$98,506.43
5 111112022 $100,370.33 $3,795.39
$96,674.93
$0.00
LESSEE:
city of ey
Sean Ashton, Mayor
Attested by'Oty,,Clork
Chiari fide'D M
Approved as to form -City Attorn"k--
%tat Ua
Yvettr. Ableh Garda
M
EXHIBIT B
EXTRACT OF MINUTM
OF GOVERNING BODV
110alk'324,11INS10 175 to] 01ty rM a 13.161,2 Ev I rol a F1,112 -M-10 wwwl
I PiplyWAL110 ILI
1, the undersigned, the duly appointed and qualified City Clerk of the City of Downey ("Lessee), do hereby ecitify on this 27"' day
of June, 2018 as follows;
(1) Lessee did, at a meeting of the governing body of the Lessee, held on June 26, 2018, by motion duly made,
d and Carried, !it accordance with all oequiremonis of law, approve Resolution No, 18-7915 ('Resolution") approving the
Agreement and Schedule i
the Lessee to witness:
9EAN ASHTON, MAYOR OR
CITY OF DOWNEY
GILBERT A. LIVAS. CITY MANAGE]
CITY OF DOWNEY
(2) The governing body of Lessee resolved that each of the above-named representatives of City of Downey hold the
position of Mayor and City Manager at the time of such authorization, and at the present time, each hold their respective offices as
stated above.
(3) The governing body of Lessee resolved that the meeting of the governing body of Lessee at which the Agreement
and the Schedule Were approved and authorized to be executed was duly called, regularly convened, and attended throughout by the
requisite majority of the members thereof, and that the action approving the Agreement and the Schedule and authorizing the
cx,ccudon thereof has not been altered or rescinded.
(4) The governing body of Lessee resolved that no event or condition that constitutes or, with the giving of notice or
the lapse of th-ne, or both, would constitute an Event of Default (as such term is defined in the Agreement), exists as of the date the
Re -solution was adopted.
(5) The governing body of Lessee resolved that all insurance required ht accordance with the Agreement is currently
maintained by Lessee.
(6) The governing body of Lessee has, in accordance with the requirements of law, fully budgeted and appropriated
sufficient funds for the current budget year to make the rental payments scheduled to come due during the original Term (as defined in
the Agreement) and to meet its other obligations for the Original Term and such funds have not been expended for other purposes.
(7) The governing body of Lessee resolves that the fiscal year of Lessee is July. I to June 30,
2 -7
Date: c -
Mari kia �D..c. CMC'
City Clerk
- Future Unlimited
CIVIC CENTER
LIBRARY
POLICE DEPARTMENT
PARKS & RECREATION
UTILITIES DIVISION
MAINTENANCE SERVICES
11111 BROOKSHIRE AVE.
11121 BROOKSHIRE AVE,
)0911 BROOKSHIRE AVE.
7850 QVILL DR.
9252 STEWART & GRAY RD.
i2s24 BELLPLOWER BLVD,
". BOX 7016
DOWNEY, r-AIJFDQNIA
F0 Box 701's
DOWNEY. CALIFORNIA
DOWNEY, �ALIFORNIA
DOWNEY, CALIFORNIA
DOWNEY, CALIFORNIA
90241-7016
DCWNEY�ALIFORN(A
90242
00241-7016
00242
90241-706
582.-flo4-7360
90241-7016
562-904-7235
662-904-7202
SG2-904-7194
562-869-7331
www.d.wn.Vllbf.fy.org
552-1061�0771
www,downeymoro
- FUTURE UNUMITED -
YVETTE M. ABICH GARCIA
City Attorney
215 S. Seth Child Road
Manhattan, KS 66502
Re- Lessee: City of Downey
Ladies and Gentlemen,
As legal counsel to City of Downey (the "Lessee"), I have examined (a) an executed counterpart of a
certain Master Equipment Lease Purchase Agreement, dated as of 7/5/2018, Exhibits thereto and
Schedule of Equipment No. 01, dated 7/512018 (collectively, the "Agreement"), by and between
Community First National Bank (the "Lessor") and Lessee, which among other things, provides for the
lease with option to purchase by the Lessee of certain property listed in the Schedule of Equipment No.
1 (the "Equipment"); (b) an executed counterpart of the ordinances or resolutions of Lessee which,
among other things, authorizes Lessee to execute the Agreement and (c) such other opinions,
documents and matters of law as I have deemed necessary in connection with the following opinions.
(1) Lessee's true and correct name is City of Downey;
(2) Lessee is a municipal corporation and charter city, duly organized and existing under the laws of
the State of California, and has a substantial amount of the following sovereign powers (a) the power to
tax; (b) the power of eminent domain; and (c) police power.
(3) Lessee has the requisite power and authority to lease the Equipment with an option to purchase
and to execute and deliverthe Agreement and to perform its obligations under the Agreement.
(4) The Agreement and the other documents either attached thereto or required therein have been
duly authorized,japproved and executed by and on behalf of Lessee and the Agreement and other
OFFICE OF THE CITY ATTORNEY 11111 BROOKSHIRE AVENUE P,O,BOX 7016 DOW EY, CA 90241-7016 (562)904-7288 FAX(562)923-6388
documents either attached thereta or required thdrein are the valid and binding obligations of Lessee
enforceable in accordance with their terms.
(5) The authorization, approval and execution of the Agreement and all other proceedings of Lessee
relating to the transactions contemplated thereby have been performed in accordance with all open
meeting laws and all other applicable state or federal laws.
(6) To the best of my knowledge, and as of the date of this opinion, there Is no proceeding pending
or threatened in any court or before any governmental authority or arbitration board or tribunal that, if
adversely determined, would adversely affect the transactions contemplated by the Agreement or the
security interest of Lessor or its assigns, as the case may be, in the Equipment.
(7) The signatures of the officers which appear on the Agreement hold the offices set forth below
their names.
(8) No further approval, consent or withholding of objection is required from any federal, state or
local governmental authority with respect to the entering Into or performance by the Lessee of the
Lease and the transaction contemplated thereby.
(9) The Equipment leased pursqqt toth.$` 00"ment constitutes personal property and when
subjected to use by Lessee will not b6.or�become fixiures under applicable law.
(10) The Lessee is a political subdivision within the meaning of Section 103 of the Internal Revenue
Code of 1986 as amended and the related regulations. and rulings.
All capitalized terms herein shall have the same meanings as in the foregoing Agreement unless
otherwise provided herein. The above opinion Is for the sole benefit of the Lessor and can only be relied
upon by the Lessor or any permitted assignee or sub -assignee of Lessor under the Agreement. This
opinion letter speaks only as of the date set forth above. In rendering this opinion letter, I undertake no
obligation to supplement or update this letter in the future. This opinion letter Is limited to the matters
on which the Lessor has requested my opinion, and this opinion letter should not be read as expressing
any opinion except on the matters expressly set forth herein,
Sincerely,
CITY OF DOWNEY
JL
tette M. AbIch Garcia
ity
elle Attotomey
qA ----
I A-1 -4
1. Designation as Qualified Tax -Exempt Obligation. Pursuant to Section 265(b)(3)(13)(i) of the Internal Revenue Code
of 1986 as amended (the "Code"), the Lessee hereby specifically designates the above referenced Agreement as a
"qualified tax-exempt obligation" for purposes of Section 265(b)(3) of the Code. in compliance with Section
265(bX3)(D) of the Code, the Lessee hereby represents that the Lessee will not designate more than $10,000,000 of
obligations issued by the Lessee In the calendar year during which the above referenced Agreement is executed and
delivered as such "qualified tax-exempt obligations".
2. Issuance Limitation. In compliance with the requirements of Section 265(bX3)(C) of the Code, the Lessee hereby
represents that the Lessee (including all subordinate entities of the Lessee within the meaning of Section 266(b)(3)(E)
of the Code) reasonably anticipates not to issue in the calendar year during which the above referenced Agreement is
executed and delivered, obligations bearing interest exempt from federal income taxation under Section 103 of the
Code (other than "private activity bonds" as defined in Section 141 of the Code) in an amount greater than
$10,000,000.
LESSEE'
City of n
City
ZAshton, V r
Approved as to form -City MOM
yv" -AlIch Carda
I
INSURANCE COVERAGE REQUIREMENTS
Lessee, City of Downey
Please nark one of the following; I
(., Pursuant to Section 6.05 of the Agreement, you have agreed to provide us evidence of insurance covering the property i
In the Agreement. A Certificate of Insurance naming all insured parties and coverage ge must be provided to us as soon as
possible, but no later than the date on which delivery of equipment occurs.
Pursuant to Seotlon 6.05 of the Agreement, we are self -Insured for all risk, physical damage, and public liability and will t
provide proof of such self insurance in letter form, together with a copy of the statute authorizing this form of Insurance.
Coverage must beprovided to us as soon as possible, but no later then the date on which delivery of equipmentoccurs.
r_
W.
Equipment to be insured: Two (2) New Ford E450 Road Rescue Type 3 Ambulances
Policy should be issued and mailed to: Community First National Bank and/or Its Assigns x
215 S. Seth Child Road g
Manhattan, KS 66602
INSURANCE REQUIREMENTS:
1. LIABILITY
V $1,000,000.00 Aggregate Bodily injury
✓ $1, 000, 000.00 Combined Single Limit per Occurrence
✓ Community First National Bank and/or Its Assigns M=be listed as additional insured and loss payee.
2. _ PHYSICAL DAMAGE
* All risk coverage to guarantee proceeds atifflclent to cover the replacement cost of the equipment
✓ Community First National Bank andlor Its Assigns U= be listed as additional Insured and loss payee.
3._ ENDORSEMENT
✓' Lessor will recolve at least thirty (30) days written notice from Insurer prior to alteration, cancellation or
reduction of insurance coverage.
Deductibles should be listed on the Certificate of Coverage
T 4E CE TIfI A SHOULD BE:
IyIAILED TO ci rna cI Mg., ket
OR EAXED TO' 888,777,78 5
Insurance Company Name: Independent Cities RiskManagement Aax tt rpt y
■
LESSEE;
City, of wrtey
een Ashton, Mayer
Attested by City.Cierk
Maricla'0te, Cly �-r
{,
9
Approved as to -City Attomey
civ M, AbWi Garda
Y
INVOICE INS CTI.
RE: Schedule of Equipment No, 01, dated 71512018, to Master Equipment Lease Purchase Agreement, dated as of
71612018, between Community First National Sank, as Lessor, and City of Downey, as Lessee.'
;i
Lease Number: DO CA2018.06AE
1.
Equipment Description: Two (2) New Ford E450 Road Rescue Type 3 Ambulances
Please provide contact Information fbr Wiling and Invoicing purposes.
r
Person/Department: Anil Gandhy, Finance Director/Finance Department
P.O. Box/Street: City of Downey
City, State, Zip 1.1111 Brookshire Ave.,/P.O. Box 7017
Telephone Number: 562-904-7265
Email Address: agandhy@downeyca.org,
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15 —Mun]Std - LCR
NOTICE OF ASSIGNMENT
City of Downey
I I I I I Brookshire Ave
Downey, CA 90241
- T161208�betee
Escrow Agreement entered Into as of 71512818.
01�ase be advised that Community First National Bank has assigned all its flghti title and Interest in, to
Equipment leased thereunder and the right to recel ve Rental Payments thereunder to i
assignee:
Pinnacle Public Vinancelt Inc.
-077 Z Hartlow Dr., pulte 115
�ri r AZ 5255
Community First National Bank will be the servicing this lease and all Rental Payments and payment of
the Purchase Option Price due under the Agreement will be made to:
215 S. Seth Child Road
Manhattan, KS 66502
LESSEE:
City
ty a nay
Sean Ashton, Mayor
Attested by City Clerk
fl -1/1 A
*Lossor may at a future date desire to a
determines a need to assljn`thls 16 4;
Signabire X
Blake Kauso VP
Name andfltle
Approved as Ila form -City Attortiey
v tie .Ableb Garcia
n this lease agreement. At this Ume, a specific Assignee is undetermined. At such time Lessor
see will be provided with a completed copy of this page for their records and be made aware
at payments going forward. This assignment option Is outlined In Article V of the Master
— 16 —MunfShl - LCR
OMMUNiTY 216 S. Seth Child Road
LEASING Manhattan, KS 66502
p A R "7 H E R S Phone: 888.777.7850
9iuxMn of Eonmiunlly Fht liatlonaf flank Fax. 888.777.7875
: a 4 i clou a net
PublicPinnacle Finance,
8377 E. Hartford Dr.
Scottsdale, AZ 85255
Re: Master Equipment - Agreement
ti 442�iii�,l 6traffirutiV First National Bank, (Lessor); Lease #DOWCA2018-06AE
This letter should serve as notification that Community First National Bank/Community Leasing
Partners will file the IRS Form 8038 for City of Downey, California, EIN 95-1918225 On 715/2018:
We will ensure the form is submitted no later than the required filing date deadline
If you have any questions please feel free to contact me at (785) 3234220.
esptflly,,
Cindy Turner
Assistant Vice President -Leasing Operation
ESCROW AGREEMENT
WITNESSETH
WHEREAS, the Equipment has or will be ordered from the Vendor, and there Is expected to be a delay in delivery of the Equipment to Lessee; and
WHEREAS. in order to secure the obligations of Lessor under the Agreement. Lessee has requested Lessor to set aside In escrow with the Escrow Agent,
purai9ant to tato terms Hereof, the anticipated purchase price of the Equipment; slid
WHEREAS, Lessee, as agent for Lessor. Wil cause. the Equipment to be acquired from Vendor In accordance with the Purchase orders or con
tracts
therefore, and neither Lessor nor the Escrow Agent shall be obligated to assume or lrorform any Obligation of the Lessee or vendor with respect thereto or
under the Agreement;
NOW, THEREFORE, In consideration of the premises and the mutual covenants contained herein, the parties agree as follows:
ARTICLE I. APPOINTMENT OF ESCROW AGENT: DEFINITIONS
Section 1,01' Aoaot t t of en Lessor and Losses hereby appoint and employ Escrow Agent, to -calve, hotd, invest and disburse the i
moneys to be paid to it pursuant to this Escrow Agreement afld the Agreement, and to perform certain other functions, all harelrr praulded. y
executing and delivering this eacrow Agreement. Escrow Agent accepts the duties and obligations of Escrow Agent prouldeti herein, but only upon the
terms and conditions set forth.
a .02a The teams daflned in this Section shaft, for all purposes of this Escrow Agreement have the meanings 9pedfled below. Any
capitalized term not defined Wow shatl have the meaning ascrtbed In the Agreement,
•Agroomant" means the Schedule of Equipment No. 01, dated 71512048 to Master Equipment lease Purchase Agreement dated 71 firs, b1" and between
Lessee and Lessor and any duty authorized and executed amendment thereto, the terms or which are incorporated harein by Mer n W
'Acquisition Costs" mans, wrttt respect to the Equipment, the contract price paid or to be paid to Vendor therefore upon acqulsloon or delivery of any
.2.. .,4!«.n.. —9 of.- e.....c—r. 1K .—rr. us:w rr,.n hlir^ka— nmexr or contract therefore. Acquisition Costs Include the administrative, engineering, legal;
yes of Lessor, to Escrow Agent
&—o" Moana the representative
h ft acquisition, delivery and financing by Lesser of the EquilemortL t
tarn attached fo the AgroomenL
held by the Escrow Agent pursuant 10 Article 11 of this Escrow AgreomenL
tow Agent the Moneys raquinld to be deposited pursuant to Article 11,
lament, together with any and ail modifications, tions and altomflons thereto, to be
tcassor'thereto acting as Escrow Agent pursuant to this Escrow Agreement
authorized and a uted amendment to. i
practice of low before the highest art of the `State in which he maintains an office and
,
.
mr a person authorized by the Lessee to act on Its behalf under or with respect to this
ant or Assistant Vice President of Lessor. or any person authorized to act on f of
P a codouto conferring such M11hortz0fleft executed by the President, any Vice lomstdard
Lessee Represohtsttvrr,
t under the Agreement is due and payable, as set form In ifra Payment Schedule. py,,
"re form`attached hereto as Exhibit A to be executed by Lessee and LesW and submitted
1
is United States or Amadoo, (a) obligations guaranteed by ffie United States, (111) garwall
tacos, (iv) certificates of deposit, time deposits or demand deposits with a bank or savings
A Kmtaaa, provided that such certfficatas of deposit, time deposits or demand dopooft 11
the Fedorat Savings and Loan Insurance Corporation, are fufly secured by obligations
a assets of which are obligations of or guaranteed by the united States of America and
nw �.a ""g.r�� rtu rnruret A';imLtSrS CraE'❑oratlon:. : "....
Hent during the then cur=rent Puritan of the terra of the Agreement.
ement Is in effect, as provided In Article III of the Agreement.
the agents or daalars of the manufacturer from whom Lessor purchased Witt ptechasO or
ed for the soquieltion of the Equipment.
resents and warrants that It has fair legal authority and is deity empowered to enter into this
Ire exacuiion of this Agreement by the officers and person signing It.
d:
ish a speelaf fund designated as the "Acquisition Fund", shalt keep such Acslr laltlon Fund
anti shop admIntater such funds as expressly provided hereunder.
Date, Lessor shall deposit with the Escrow Agent the amount of S4fiaAffi d0. Escrow Agent
nd to be held, applied and disbursed as herein provided.
xquisirlon Fund shall be expanded for the Acquisfflon Costs or the Equipment. Escrow Agent
2e Equipment, upon r 1pt from Louse and Lessor the following Items:
to Vendor pursuant to a oordnect or purchase order, (1) a duty eoeculvsl Payment
statement attached (2) where applicahie, a duplicates odglnaf of any changer Order'
17-MunlStd - LCR
Fund to Lessor.
red to be svetlable far ecqutsitiun.
mponsW or liable for any Ione suffered in connection with any Investment of funds made by It
icales of deposit) in any stank or trust compefly authoftmd to accept t deposits of public funds ltraptudssg the rraMng aWarkmBnc
t, as arta to the extent requiled by lawn, shelf be securest at an t mas,;by obligations vwttich are eitgtbte by low to Re -to deposits of
igationt. shall be deposited with such bank or banks as may be selected by Escrow Aqant, and hold by or W 1ho account of the.
Tor such deposits_
I. Wass aWler terminated pursuant to Article VII, this Escrow Agreement shall terminate upon itis final distribution of all moneys
18-MuniSta . LCR
reasonable.
The recitals, statements and representations by Lessee and Lessor contained in this Agreement shall be taken and construed es made by and an the part
of the Lessee and lessor, as the case may be, and not by the Escrow Agent, and the Escrow Agent does not assume, and shall not have, any
responsibility or obligation for the correctness of any thereof.
C Y f
the i J E
ARTICLE VII. DEFAULT OR NON -APPROPRIATION
the rights arid, duties of each of the parties, under Oils Escrow Agreement
f the other pattes. Notwithstanding the above, Lesson may treaty assign
bitshad hereunder to conneoffon with an assignment by Lessor of the
by agreement among all of the parties.
allver any and all such further resolutions, (riskrUmentS and OSSUMMOS as
the performance of this Escrow Ag runt, and for bettor assuring and
(a) Lessor shell have the right to terminate this Escrow Agrasmarrt upon an Event of Default under the Agreernant, or tertn11100n of ere'Agreement
pursuant to Sectlon 4.05 thereof, which right Shall not be exercised Iftsth;an 16 days after Lessor shall have givers Losses wrltton notice of such
default ortetntthation for naaa•approprls(k )M Lips recaipt of notice otiamafrrtttkrra frrtm Leaw, Escrow Agent shall pay to Lessor, or Its assignee,
all moneys tri the Acquisition Fund in accordance with Section 1W
(b) In the event of the failure by any party hereto to observe and perform any covenant, condition or agreornent on to part to be observed or
performed under brim Escrow Agreement any non-de€eulling party hereto shut hmm all of the rights and remedies now or hereafter existing at
or to equity against the defaulting party.
(c) No delay or omission to exercise any such sight at power accruing upon any default shell be construed to be a waiver thereof, but any such right
at powermay be exettized from time to firne and as often as may be deemed expedient
19 -MunlStd - LCR
liffisuccessars
i*^r"i^i d �xldi = Any prrnri Ston of this Escrow Ag mant,nd to be prohibited by laws shall be Ineffective only to the extent of such
d shell not lrrvalidate the remainder of the rove A ent.
131rxi{no Effect Srrcc yrs. This Agreement shall be binding upon and i to die benefit of the ood their remcrd aastgns. ra In this E agreement soy hareto is named mr mforred to, such references shall be dearned to Incloassrrre pr eestgno thoaarst and oil nan and agreements contained In this w Agra nt by or on behalf of any party hereto shalt
fo the benefit of permitted sn ors and assigns thereof whether or not so esfrressed�
Yrf r rnrtc n In ountaroads, This Es ftre dnt may be executed in several counterparts, each of which shall be an original and all of
iris shall constitute hot ono and the same agreement
Sactlon 9,07`. Hoadina%. The headings or blies of gra l Articles and sections heroof, and any tahlaa of co "'Into. app dad to capias h shall 6a
IN WITNESS WHEREOF, the parties have executed this Escrow Agreement as of the date and year first above written.
ESCROW AGENT:
Community First National Bank
215 S. Beth Child Road
Manhattan, KS 66 2
Signature
r
LESSOR:
Community First National Bank
215 S. Seth Chin! Road
Manhattan, KS 66502
ignattar'
Blake Kaus,_VP
Name and Tile r
LESSEE, ,
City of C y`
Sean Ashton, Mayor
Attested by City Clerk
aria is puarte, CMC : v
3
Approved as to form -City Attom y`
a Ma Abich Garcia'
20 -Muaistd LCR
EXHIBIT
PAYMENTREQUESTFORM
•: • .. .:. • .:: • a `#. • • . i.. �. .. . ';. iii. u ..... i . if
6=2
By executing this Payment Request Form the Lessee hereby represents that the Payee or Payeeshied above who are requesting payment have
delivered the Equipment or a portion of the Equipment or performed the services to the satisfaction of the Lassee and that the amounts requested above>
by the Payee or Payees are proportionate with the value of the Equipment delivered or services rendered by the Payee or Payees,
kes a claim to such dttee that Lesses Lesswill take all measures necessary to secure 0110
secure fille to this portion of the Equipment and keep the tease In full Force and effect.
Final Disbursement. The undersigned certifies that the folfowing documents are attachad to this Payment R:
funds from the Eacrow Account: (9) Final Vendor Invoice, (2) Signed Acceptance Cartlftcale, (3) Insurance
and
LESSEE:
city of 0 ey
__ c6eel��-
Sean Ashton, Mayor ;
Attested by City Clerk
�arMacla�Duarte,"CMC
Approved as to form.GitV Attorney
Form when there is a final release of
cafe, (Q) front and back copy of the
By executing ft Payment Request
int for all purposes under the Lease,
TAX COMPLIANCE AGREEMENT AND NO ARSITMGE CERTIFICATE
This Tax Compliance Agreement and No Arbitrage Certificate is Issued In connection with that certain Schedule of Equipment
No. 01, dated 71512018 to Master Equipment Lease Purchase Agreement dated as 11512018 by and between Community First
National Bank, ("Lessor") and City of Downey ("Lessee").
1.1. This Carillicate Is executed for the purpose of establishing the reasonable expectations of Losses as to fuWro events regarding the financing of certain
ui ont by Lessee as described in the Schedule of Equipment No. 01. dated 7IW2018 to Master Equipment Lease Purchase Agreement dated as of
T 018 (1ho "Lease') between Lessor and Lessee at all related documents executed pursuant theroic, and contemporaneously herewith with respect to the
firronting of the acquMUon of"Two (2) New Ford E460 Road Ressue Type 3 Ambulances of eqUpment (the 1SqofpmW) by Lessor for Lessee (the Less a and
such other documents are hereinafter collectively referred to as the "Financing Documon&,).
12 The Individual executing this Certificate an behalf of Lessee Is an officer of Lessee delegated with the responsibility of reviewing and executing the Financing
Documents,
1.3. To the boat of the underalfinotfs knowledge, information and belief, the expectations contained In this Certificate are reasonable.
1.4, Lessee has not been notified of any Rating or proposed 11affrig of It by the Internal Roveritio Service as an Issuer whose certifications as to arbitrage
may not be relied upon.
I.S. The rental payments due under the Financing Documents will be made with monies retained In Lessee's general operating fund (or an account or sub
account therein), No sinking, debt service, reserve or similar fund or account will be maintained for the payment of the rental payments due under the
Financing Documents or pledged as security therefor.
1.6. If any other governmental obligations wore or am being Issued by or on behalf of Lasses within rdt0on (15) days of the date of issuance of the
Financing Documents, such obligations either (1) were not or are not being issued at add pursuant to a common plan of fine with, or (H) will not be
paid out of substantially the same source of funds as, the financing pursuant to the Financing Documents.
2, Puroosto of the Firvaricina, Dvcumaots.
22. No portion of the principal amount represented by the Financing Documents Wit be used as a substitute for other funds which wore oftrwtsa to be
used as a source of firtandrig for the Equipment, or will be used, directly or Indirectly, to replace funds used by Losses to acquire investments which
produce a yield materially higher than the yield to Lessor under the Financing Documents.
2-3. Lessee does not expect to sell or otherwise dispose of the Equipment in whole or In part, at a date which is earlier than the final retrial payment due
under the Financing Documents.
1,Source and Olsbursoment of Fund&
3.1. The principal amount represented by the Financing Documents does not exceed the amount necessary for the governmental purpose for which the
Financing Documents were entered Into. Such funds are expected to be needed and fully expended for payment of the costs of acquiring, equipping and
Installing the Items of Equipment,
3,2, It Is contemplated that the entire amount deposited in escrowwIll be used to pay the acquisition cost of EVIpment to the vendors or manufacturers
thereof, provided that a portion of the principal amount may be paid to Lessee within such period as reimbursement for Acquisition Costs already made by
It so longus the conditions set forth in Section 3.3 below are satisfied.
3.3. Lessee shad not request that it be reimbursed for Equipment acquisition cost payments already made by it unless the following conditions have been
(a) Lessee made a doclaroden of Its reasonable btandan to reimburse the acquIsItIon cost payment sought to be retrnbursed with the
proceeds of a borrowing not [star (ban slxly (60) days after the date on which It made the payment, which declaration sallsfift the "Official
Intent Requirement* set f" In Tress. Reg- SeO, 160-2;
(b) The reimbursement being requested will be made by written allocation before the later of eighteen (18) months after the acquisition cost
payment was made or eighteen 118) months after the Items of Equipment to which such p
, ayment relates were placed in sarview,
(n) The entire payment with respect to which reimbursement Is being sought Is a captim expenditure, being a cost of typo property chargeable
to a capital account under general federal Income tax principles; and
(d) Losses will use any reimbursement payment for general operating expenses and not In a manner which could be conalmed as an ardilce
or davice, under Trees. eg. Sac, I
- 146-10 by, vKuo at among other things, use to refund, or to create or Increase a sinking, reserve or
R
replacemantfund with respect to, any other obligations Issued by It.
4.jMorary Period.
4.1. Lessee expects, `wthfirt six months from the date of Issuance of the Finsndng Documents, (a) to have had disbursed from escrow, an amount In
excess of the lesser 2 1/2% of the amount deposited by Lessor In escrow or V00,000. or (b) to anter Into binding obligations with third parties obligating
Lessee to spend such amount.
4.2. The ordering and acceptance of the Items of Equipment will proceed with due diligence to the data ofiffnal acceptance of the Equipment.
4.3. The items of Equipment being acquired by Lessee will be delivered at vatious times. At least 15°1. of the sum of the amount deposited in escrow and
the reasonably anticipated interest earnings thereon will he <used to pay the acquisition price of Ito" of Equipment within six months from the date of
issuance of the FInturcIng Oncuments; at lo&it 00% of the sum of the amount deposited In escrow and the reasonably anticipated Interest earnings
thereon wig he used to pay ft acquisition cast of Items of Equipment wIthIn, 12 months from the date of Issuance of the Financing Documents; and 100%
of the amount deposited In escrow and Interest earnings thereon will be used to pay the acquisition cost of Items of Equipment prior to 18 months from the
date of Issuance of the Financing Documents.
4A. The total acquisition cost of the Equipment is not required to be paid to the vendors or manufacturers thereof until the Equipment has been accepted
by Lessee.
5.1. The Financing Documents provide that the mantes deposited in escrow shall be Inivasted until payments to the vendor(s) or manufacturer(a) of the
Equipment are due. Lessee will ensure that such Investment will not result In Lessee's obligations tinder the Financing Documents being treated as an
"arbitrage bond" or a 41adevally guaranteed bond' within the meaning of Section 148(a) or Sacgon 149(b) of the Internet Revenue Code of 1986, as
amended (the "Cods), respectively. Any monies which are earned from the investment of thess funds shot) be labeled as Interest earned. All such
monies will be disbursed on or promptly after the date that Lessee accepts the equipment.
22 --rMuniStd - LCR
Attachment "D"
a nt Ltse.
6.1. No part of the proceeds of the Floanoing Documents, or the Equipment will be used In any "private business use" within the meaning of Section
141(b)(6) of the Internal Revenue Code of 1086, as amended.
8,2. No Pett of the proceeds of the Financing Documents will be used, directly or Indirectly, to make or Ifnance any loans to non-governmental entmes or
to any governmental agencies other than Lessee,
7 Frl I U 9-116 e.
7•f. Payment of the principal or Interest due under the Financing Documents is not directly or Indirectly guaranteed, In whole or In part, by the United
Slates or an agevty or mettumentality tharf.
7.2. No portion of the proceeds under the Financing Documents shad be (1) used in making loans, the payment of principal or Interest of which are to be
guaranteed, In Whole or In part, by the L,InIted States or any agency or instrumentality thereof, or (rr) Invested, directly or todlrectly, to federally Insured
deposits or accounts if su,* investment would cause the financing under the Financing Documents to be federally guaranteed vAthGn the meaning of
Section 149(b) of the Code
. �. rr�etranaear.
6.1. L ee agrees to ty wills Fhe rebate requkement set fart la in 5ectlon 148(f) of the Code In the event that for any reason It Is applicable to the
gnanoing p ant% Fina ` g Daou rs
6.2. Lessee shall keep a complete and accurate reeartl of ell owners or assignees of the Flnancing Documents in form and Substance satisfactory to
ply Section 1dS(a) of rite Code sant Lessor or Its assignee tagreps 10 sot as Lessees agent for such purpose.
8. a Lessee sfiail rnerntakt complaia end accurate a laltshkng Liao xperadtture of the proceeda of the Financing Documents and interest earnings
thereon for a period of five yerars air payrPant In gyri triad rhe Iraaracing l oumenis,
IN WITNESS WHEREOF, this Tax Compliance Agreement and No Arbitrage Certificate hes been executed on behalf of Lessee as of the date set forth
below_
LESSEE:
City ofzton,
S yor'
Attested by City Clerk
=i§ e
Approved _ . oAttorney
23 _MuniStd - LCR